"Far more serious" allegations, says Key, as Collins resigns

"Far more serious" allegations, says Key, as Collins
resigns

By Pattrick Smellie

Aug. 30 (BusinessDesk)
- Prime Minister John Key has been handed a cast-iron excuse
to rid his government of its troublesome Justice Minister,
Judith Collins, using an email supplied anonymously to his
office yesterday which appears to show Collins conspiring
with the Whaleoil blog run by National Party activist
Cameron Slater to unseat the then head of the Serious Fraud
Office, Adam Feeley, in 2011.

Collins was the Minister
responsible for the SFO at the time and in the MOctober 5
2011 email, Slater says he has "spoken at length" to
Collins, who he claims "is gunning for Feeley" and was keen
to know anything of his background that she could pass on to
the State Services Commission.

Such actions would breach
of the State Sector Act, which governs the employment
relationship between a departmental chief executive and
their Minister

"In my view, this is a far more serious
matter than anything else I have seen," said Key, who has
baulked twice at sacking Collins twice this year, first over
her association with Oravida, a Chinese dairy products
company where her husband is a director, and most recently
for her role in hounding a public servant through the
Whaleoil blog in 2011.

Collins was already on her "last,
last warning" after the blog allegations contained in the
"Dirty Politics" book published by political journalist and
activist Nicky Hager on Aug 13.

Key said he rang Collins
this morning to discuss the email and had "understood the
need to resign", although Collins "she strongly denies any
suggestion of inappropriate behaviour on her part."

An
independent inquiry will be established and Collins had
expressed a desire to "clear her name" and would "actively
cooperate", said Key of a Minister who until recent times
had been seen as high-performing in her portfolios,
politically ruthless and with ambitions to replace Key,
which now appear very remote.

Key said he had told her not
to expect a Cabinet post in a re-elected Key government,
although if an inquiry found in her favour, the possibility
of a return to Cabinet could not be ruled out.

“The
relationship between a Minister and their Chief Executive is
vital, and goes right to the heart of a trusted, effective
government," said Key.

"She certainly has a different
version of events," said Key. "But the seriousness of this
will not escape anybody. This is the head of the SFO. This
looks at least like a campaign that at least she was aware
of that sought to undermine the head of the SFO. She would
strongly argue that's not correct.

"There is another
reading of those events. That's simply that those issues
were passed on to the State Services Commissioiner, that's
of course the appropriate place for any concerns that a
Minister might have to deal with."

The email from Slater
addressed to "Carrick" and "mark", whose surname has been
excised, also claims he is "maintaining daily communications
with Jared Savage at the Herald and he is passing
information directly to me that the Herald can't run, and so
are feeding me to run on the blog", while other information
was arriving via the WhaleOil "tip-line" - a feature of
Collins's relationship with Slater highlighted in Dirty
Politics.

Carrick Graham, a public relations entrepreneur
and son of former Justice Minister and chairman of the
failed Lombard Finance group, Sir Douglas Graham, also
features prominently in the book as a conduit of information
to the Whaleoil blog intended either to have political
impact or to back his corporate clients.

Around October
2011, Feeley was taking heat in the media for drinking a $70
bottle of champagne that had belonged to Bridgecorp, a
failed finance company which was the subject of an SFO
investigation that led to the jailing of two former
directors, Rod Petricevic and Rob Roest.

The champagne was
consumed at an SFO staff drinks session at Feeley's home to
celebrate the conclusion of the Bridgecorp case.

The
Herald's most senior business commentator, Fran O'Sullivan,
wrote at the time that Collins was regarding Feeley's
decision to celebrate the prosecutions "with plonk that came
from the alleged fraudster's company" as a question of
character and judgement, and had passed the matter to the
SSC.

Slater said in the email he planned to try and
interest a Fairfax journalist in the issue and that "Cathy"
would be in touch with the National Business Review. Cathy
Odgers, a close friend of Slater's who engages with New
Zealand politics while living in Hong Kong as an
international tax specialist, also features in Dirty
Politics, which reproduces emails of a group plotting on
various political fronts, including within the National
Party, where the Whaleoil revelations have caused widespread
alarm and distaste at the highest levels of the
party.

Feeley announced his resignation from the SFO in
July 2012 to become chief executive of the Queenstown Lakes
District Council. Collins had initially touted Feeley as a
new broom at the office, coinciding with the need for
widespread finance company collapses ahead of and during the
global financial crisis of 200/9.

In a statement, Collins
said Statement from Honourable Judith Collins MP said she
had "informed the Prime Minister that I am resigning as a
Minister from Cabinet."

"I was not party to this
email or discussion and have only today been made aware of
it," she said of Slater's email.

“I absolutely and
strongly deny this and any suggestion of inappropriate
behaviour."

The Wellington-based BusinessDesk team led by former Bloomberg Asian top editor Jonathan Underhill and Qantas Award-winning journalist and commentator Pattrick Smellie provides a daily news feed for a serious business audience.

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